The Arab World Is Not a Country: Startup Turkey Takeaway #4

Arab youth defied the status quo long before the Arab Spring. Gripped by the global startup bug, they, like the twenty- and thirty-somethings the world over put their ideas into action. From Morocco to the Gulf Cooperation Council (GCC), they launched ventures that would improve, empower, and change their respective communities - respective being the key word.

A panel on entrepreneurship in the Middle East, North Africa (MENA) region during eTohum’s Startup Turkey in Antalya, participants pointed out that despite having a common language, when it comes to entrepreneurship, the Arab world is not a homogenous bloc.

Pamir Gelenbe, a venture capitalist with Hummingbird Ventures, pointed out that there is great opportunity throughout the Middle East region, yet success varies. “For us we see opportunity in the Gulf markets, in Saudi Arabia first and foremost and the connected countries in the Gulf.” He also noted good prospects for ventures in Iraq, particularly in the northern part of the country.

E-commerce, which dominates the MENA startup space, works best in these countries, less so in North Africa, particularly Egypt. “Customs in Egypt are extremely difficult to deal with.” Regarding Morocco, Gelenbe said, that country “is a small market.”

Omar Christidis, founder and CEO of ArabNet, further elaborated on MENA’s startup diversity, highlighting the distinction between the region’s “production and sales” market. “You’ve got the Levant areas: Lebanon, Jordan, Egypt – a strong hub for development and content creation; whereas the GCC where there is high GDP is where they’re selling. It’s common that that you’ll have most of a company’s staff in the production market and sales staff in the GCC…You’re selling in Saudi but your company is based in Jordan.” Gelenbe said that was precisely the problem.

“People in Saudi Arabia know that they’re not talking to someone who is there (in Saudi Arabia) but someone who is in Jordan… in e-commerce you have to be as local as you can.”

“Saudi Arabia is a very particular market,” Christidis said. “It is culturally very different. While linguistically everyone speaks Arabic, everyone speaks a different dialects,” he said, adding that for Arab entrepreneurs to succeed across the Middle East, they needed to localize.

Toward the end of the discussion, Christidis and I had an exchange about another area where there are varying degrees across MENA: women. While women face cultural challenges throughout the region, the restrictions put upon them by Saudi’s rulers are the starkest.

Christidis pointed out that while women out number and outperform men in Saudi universities, they still couldn’t drive. “Wouldn’t if follow that with all the money coming in (from entrepreneurship) the society would change?” I asked.

“It’s such a complex society…these cultural norms run quite deep…there is a wave of change that is hitting the country, but these things are deeply woven into the fabric of society.”

Not satisfied, I pushed back, “The Saudi government has made a lot of strides to promote entrepreneurship, yet you have this dichotomy where you have limitations on women,” I said. “What is going to be? Are they actually interested in supporting startups and building an entrepreneurial ecosystem or not?”

“The politicians have to play a delicate balance between the agenda that they would like to have and their quite religious fundamentalist and influential constituency,” Christidis responded. “I’m not sure if it’s all in their hands.” A compelling reason for MENA entrepreneurs to work even harder and push further on the persuasive path of startups they've carved out.